innovation, firm dynamics, and...
TRANSCRIPT
Innovation, Firm Dynamics, and Growth
Ufuk AkcigitUniversity of Chicago & NBER
SEEK - October 8, 2015
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 1
Background
Understanding the aggregate implications ofgrowth & industrial policies requires a goodunderstanding of micro players of themacroeconomic system.
Going from micro-to-macro is crucial.
Policies that seem good in partial equilibriummight have different general equilibrium impacts:
Aggregate price effectCompetition, Schumpeterian effectComposition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 2
Research Approach
Start with empirical regularities in the micro data
Construct a general equilibrium theory of firmdynamics and aggregate growth
Estimate the structural parameters of the modelusing micro firm-level data
Conduct counterfactual policy experimentsIncumbent R&D subsidyEntry subsidySubsidy to incumbent fixed operation cost
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 3
Today’s Roadmap
1 Firms
2 Innovators
3 Innovations
4 Implications
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 4
Part 1: Firms Akcigit and Kerr (2010)
PART 1:
FIRMS
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 5
Part 1: Firms Akcigit and Kerr (2010)
The Model Economy
0 1
quality level
q
sector j
US Economy
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 6
Part 1: Firms Akcigit and Kerr (2010)
The Model Economy
0 1
quality level
q
sector j
GDP = Sectors combined
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 7
Part 1: Firms Akcigit and Kerr (2010)
Sector-specific Productivities
0 1
quality level
q
sector j
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 8
Part 1: Firms Akcigit and Kerr (2010)
Example of a Firm
0 1
quality level q
sector j
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 9
Part 1: Firms Akcigit and Kerr (2010)
Example of another Firm
0 1
quality level q
sector j
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 10
Part 1: Firms Akcigit and Kerr (2010)
Productivity Growth: Internal R&D
0 1
quality level q
sector j
internal R&D
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 11
Part 1: Firms Akcigit and Kerr (2010)
Productivity Growth: Internal R&D
0 1
quality level q
sector j
internal R&D
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 12
Part 1: Firms Akcigit and Kerr (2010)
Productivity Growth: External R&D
0 1
quality level q
sector j
External R&D
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 13
Part 1: Firms Akcigit and Kerr (2010)
Productivity Growth: External R&D
0 1
quality level q
sector j
External R&D
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 14
Part 1: Firms Akcigit and Kerr (2010)
Reallocation is Taking Place...
0 1
quality level q
sector j
External R&D
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 15
Part 1: Firms Akcigit and Kerr (2010)
Competition Creates Selection
0 1
quality level q
sector j
External R&D
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 16
Part 1: Firms Akcigit and Kerr (2010)
Eventually Some Firms Exit
0 1
quality level q
sector j
External R&D
Exit
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 17
Part 1: Firms Akcigit and Kerr (2010)
In the Meantime...
0 1
quality level q
sector j
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 18
Part 1: Firms Akcigit and Kerr (2010)
Some New Entrants Show Up
0 1
quality level q
sector j
new entrants
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 19
Part 1: Firms Akcigit and Kerr (2010)
And New Entrants Replace Incumbents
0 1
quality level q
sector j
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 20
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
R&D Input prices, wages/salaries, will increase.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Entrepreneurial talent is heterogeneous.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Some are good entrepreneurs and some are bad:
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
General Equilibrium Effects of an Entry Subsidy
Aggregate price effect
Competition effect
Composition/Reallocation effect
Some are good entrepreneurs and some are bad:
VS
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 21
Part 1: Firms Akcigit and Kerr (2010)
Akcigit and Kerr (2010)
We estimate this model using US firms.
Data: Census of Manufacturing
We find:Small firms are more innovative relative to their size.
they do disproportionately more external innovations.
they generate larger spillovers per R&D dollars spent.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 22
Part 1: Firms Acemoglu, Akcigit, Bloom, and Kerr (2013)
Acemoglu, Akcigit, Bloom, Kerr (2013)
Findings:
Subsidy to incumbent R&D is not boostinggrowth.
Entry subsidy has a mild positive effect ongrowth.
Taxing incumbent’s operations increases growthby exploiting the selection/reallocation margins.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 23
Part 1: Firms Acemoglu, Akcigit, Bloom, and Kerr (2013)
PART 2:
INNOVATORS
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 24
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Alexander G. Bell
Inventor of thetelephone (1876).
Created Bell TelephoneCompany (1877).
By 1886: more than150,000 people in U.S.own telephones.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 25
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
James L. Kraft
Invented apasteurizationtechnique for cheese.
Created Kraft Foods.
His company grew intoa conglomerate: mostpopular food productsand employing morethan 100,000 people.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 26
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Ralph Baer
Created TV gameunit with paddlecontrols.
Today, the videogaming industry isworth $66 billion.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 27
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Introduction
... and the list goes on.
In addition to being very prolific inventors, theseinnovators had something else in common:
They were all immigrants.
What determines the patterns of migration?
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 28
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Introduction
... and the list goes on.
In addition to being very prolific inventors, theseinnovators had something else in common:
They were all immigrants.
What determines the patterns of migration?
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 28
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Introduction
... and the list goes on.
In addition to being very prolific inventors, theseinnovators had something else in common:
They were all immigrants.
What determines the patterns of migration?
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 28
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Introduction
... and the list goes on.
In addition to being very prolific inventors, theseinnovators had something else in common:
They were all immigrants.
What determines the patterns of migration?
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 28
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Akcigit, Baslandze, Stantcheva (2015)
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 29
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Akcigit, Baslandze, Stantcheva (2015)0
.005
.01
.015
.02
.025
0 200 400 600Citations-weighted Patents
Top 10% Inventors Top
Top 1% Superstar Inventors
Shunpei Yamazaki 53,7801patentsFThe1most1prolific1inventor1until12008Born:1JapanWorks:1Japan
Salman Akram 57131patentsFMicron1TechnologyBorn:1NigeriaWorks:1U.S.
Edwin Herbert Land155351patentsFFounder1of1PolaroidBorn:1U.S.Worked:1U.S.
5% Inventors
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 30
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Case Study: U.S. TRA 1986, Top 1% Inventors
Elasticity= 3.11 (.659)
-.4
-.3
-.2
-.1
T
op ta
x ra
te d
iffer
entia
l
.51
1.5
22.
5N
orm
. Num
ber
of F
orei
gn T
op 1
% In
vent
ors
1982 1984 1986 1988 1990 1992
Year
U.S. Synthetic U.S.Differential tax rate
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 31
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Case Study: Denmark’s 1992 Tax Reform
Elasticity= .77 (.252)
-.6
-.4
-.2
0.2
.4
Top
tax
rate
diff
eren
tial
01
23
4N
orm
. sha
re o
f for
eign
inve
ntor
s
1985 1990 1995 2000 2005
Year
Denmark Synthetic DenmarkTop tax rate differential
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 32
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Superstar Responses in Different Countries
Washington Center forEquitable Growth
Source: Author’s calculations and Akcigit, Baslandze, and Stantcheva. “Taxation and the International Mobility of Inventors.”NBER Working Paper 21024, March 2015.
How do Superstar (Top 1%) Inventors Respond to Decreased Top Tax Rates?This chart shows how many domestic superstar (top 1%) inventors and foreign superstar inventors would be added to a country ifthe top tax rate decreased by 10 percentage points from its level in that country in the year 2000.
Canada
Italy
United Kingdom
United States
Japan
Switzerland
30.6%
35.5%
32.6%
36.1%
35.1%
23.7%
Percent increase in foreign superstar inventors
If the top marginal tax rateis reduced from 48% to 38%...
Percent increase in domestic superstar inventors
If the top marginal tax rateis reduced from 56% to 46%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 51% to 41%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 47% to 37%...
43.8%DenmarkIf the top marginal tax rateis reduced from 64% to 54%...
1.9%
0.3%
5.5%
4.0%
10.6%
56.4%FranceIf the top marginaltax rate is reducedfrom 72% to 62%...
6.1%
0.1%
7.9%
Washington Center forEquitable Growth
Source: Author’s calculations and Akcigit, Baslandze, and Stantcheva. “Taxation and the International Mobility of Inventors.”NBER Working Paper 21024, March 2015.
How do Superstar (Top 1%) Inventors Respond to Decreased Top Tax Rates?This chart shows how many domestic superstar (top 1%) inventors and foreign superstar inventors would be added to a country ifthe top tax rate decreased by 10 percentage points from its level in that country in the year 2000.
Canada
Italy
United Kingdom
United States
Japan
Switzerland
30.6%
35.5%
32.6%
36.1%
35.1%
23.7%
Percent increase in foreign superstar inventors
If the top marginal tax rateis reduced from 48% to 38%...
Percent increase in domestic superstar inventors
If the top marginal tax rateis reduced from 56% to 46%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 51% to 41%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 47% to 37%...
43.8%DenmarkIf the top marginal tax rateis reduced from 64% to 54%...
1.9%
0.3%
5.5%
4.0%
10.6%
56.4%FranceIf the top marginaltax rate is reducedfrom 72% to 62%...
6.1%
0.1%
7.9%
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 33
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Superstar Responses in Different Countries
Washington Center forEquitable Growth
Source: Author’s calculations and Akcigit, Baslandze, and Stantcheva. “Taxation and the International Mobility of Inventors.”NBER Working Paper 21024, March 2015.
How do Superstar (Top 1%) Inventors Respond to Decreased Top Tax Rates?This chart shows how many domestic superstar (top 1%) inventors and foreign superstar inventors would be added to a country ifthe top tax rate decreased by 10 percentage points from its level in that country in the year 2000.
Canada
Italy
United Kingdom
United States
Japan
Switzerland
30.6%
35.5%
32.6%
36.1%
35.1%
23.7%
Percent increase in foreign superstar inventors
If the top marginal tax rateis reduced from 48% to 38%...
Percent increase in domestic superstar inventors
If the top marginal tax rateis reduced from 56% to 46%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 51% to 41%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 47% to 37%...
43.8%DenmarkIf the top marginal tax rateis reduced from 64% to 54%...
1.9%
0.3%
5.5%
4.0%
10.6%
56.4%FranceIf the top marginaltax rate is reducedfrom 72% to 62%...
6.1%
0.1%
7.9%
Washington Center forEquitable Growth
Source: Author’s calculations and Akcigit, Baslandze, and Stantcheva. “Taxation and the International Mobility of Inventors.”NBER Working Paper 21024, March 2015.
How do Superstar (Top 1%) Inventors Respond to Decreased Top Tax Rates?This chart shows how many domestic superstar (top 1%) inventors and foreign superstar inventors would be added to a country ifthe top tax rate decreased by 10 percentage points from its level in that country in the year 2000.
Canada
Italy
United Kingdom
United States
Japan
Switzerland
30.6%
35.5%
32.6%
36.1%
35.1%
23.7%
Percent increase in foreign superstar inventors
If the top marginal tax rateis reduced from 48% to 38%...
Percent increase in domestic superstar inventors
If the top marginal tax rateis reduced from 56% to 46%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 51% to 41%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 47% to 37%...
43.8%DenmarkIf the top marginal tax rateis reduced from 64% to 54%...
1.9%
0.3%
5.5%
4.0%
10.6%
56.4%FranceIf the top marginaltax rate is reducedfrom 72% to 62%...
6.1%
0.1%
7.9%
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 33
Part 2: Innovators Akcigit, Baslandze, and Stantcheva (2015)
Superstar Responses in Different Countries
Washington Center forEquitable Growth
Source: Author’s calculations and Akcigit, Baslandze, and Stantcheva. “Taxation and the International Mobility of Inventors.”NBER Working Paper 21024, March 2015.
How do Superstar (Top 1%) Inventors Respond to Decreased Top Tax Rates?This chart shows how many domestic superstar (top 1%) inventors and foreign superstar inventors would be added to a country ifthe top tax rate decreased by 10 percentage points from its level in that country in the year 2000.
Canada
Italy
United Kingdom
United States
Japan
Switzerland
30.6%
35.5%
32.6%
36.1%
35.1%
23.7%
Percent increase in foreign superstar inventors
If the top marginal tax rateis reduced from 48% to 38%...
Percent increase in domestic superstar inventors
If the top marginal tax rateis reduced from 56% to 46%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 51% to 41%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 47% to 37%...
43.8%DenmarkIf the top marginal tax rateis reduced from 64% to 54%...
1.9%
0.3%
5.5%
4.0%
10.6%
56.4%FranceIf the top marginaltax rate is reducedfrom 72% to 62%...
6.1%
0.1%
7.9%
Washington Center forEquitable Growth
Source: Author’s calculations and Akcigit, Baslandze, and Stantcheva. “Taxation and the International Mobility of Inventors.”NBER Working Paper 21024, March 2015.
How do Superstar (Top 1%) Inventors Respond to Decreased Top Tax Rates?This chart shows how many domestic superstar (top 1%) inventors and foreign superstar inventors would be added to a country ifthe top tax rate decreased by 10 percentage points from its level in that country in the year 2000.
Canada
Italy
United Kingdom
United States
Japan
Switzerland
30.6%
35.5%
32.6%
36.1%
35.1%
23.7%
Percent increase in foreign superstar inventors
If the top marginal tax rateis reduced from 48% to 38%...
Percent increase in domestic superstar inventors
If the top marginal tax rateis reduced from 56% to 46%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 51% to 41%...
If the top marginal tax rateis reduced from 55% to 45%...
If the top marginal tax rateis reduced from 47% to 37%...
43.8%DenmarkIf the top marginal tax rateis reduced from 64% to 54%...
1.9%
0.3%
5.5%
4.0%
10.6%
56.4%FranceIf the top marginaltax rate is reducedfrom 72% to 62%...
6.1%
0.1%
7.9%
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 33
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
PART 3:
INNOVATIONS &
MARKET FOR IDEAS
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 34
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
Safety Pin
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 35
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
Walter Hunt (1796-1859)
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 36
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
USPTO Patent Number 6281
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 37
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
0
5
10
15
20
25
1975 1980 1985 1990 1995 2000grant year
domestic only all
in % terms
Fraction of Patents Sold
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 38
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
Average = 5.5 years
0
.02
.04
.06
.08
.1
.12
Fre
quen
cy
0 4 8 12 16duration
in number of years
Patent Sale Duration
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 39
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
EDWARD VAN WINKLE
(1841-1923)
Main problem:Informational frictions.
Trade facilitated by theemergence ofintermediaries.
They economize on theinformation costs
They help to matchsellers and buyers ofpatent rights.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 40
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
Research Questions
Are ideas born to their best users?
How big is the misallocation of ideas?
How much does the secondary market improvethe allocation of ideas?
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 41
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
Empirical Facts We Document
1 Real sales and market value are negativelycorrelated with the distance between a firm andits patents.
2 Patents which are more distant are more likely tobe sold.
3 After a patent resale, the distance between apatent and its owner decreases.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 42
Part 3: Innovations, Ideas Akcigit, Celik, and Greenwood (2015)
Akcigit, Celik, Greenwood (2014)
We estimate the model using the micro firm andpatent data.
We find that reallocation of ideas increasesproductivity growth from
1.8% → 2%
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 43
Part 4: Innovation, Inequality, and Social Mobility Aghion, Akcigit, Bergeaud, Blundell, Hemous (2015)
PART 4:
INNOVATION, INEQUALITY
AND SOCIAL MOBILITY
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 44
Part 4: Innovation, Inequality, and Social Mobility Aghion, Akcigit, Bergeaud, Blundell, Hemous (2015)
Innovation and Income Inequality
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 45
Part 4: Innovation, Inequality, and Social Mobility Aghion, Akcigit, Bergeaud, Blundell, Hemous (2015)
Innovation and Income Inequality
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 46
Part 4: Innovation, Inequality, and Social Mobility Aghion, Akcigit, Bergeaud, Blundell, Hemous (2015)
Innovation and Income Inequality
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 47
Part 4: Innovation, Inequality, and Social Mobility Aghion, Akcigit, Bergeaud, Blundell, Hemous (2015)
Innovation and Social Mobility
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 48
Part 4: Innovation, Inequality, and Social Mobility
Aghion, Akcigit, Bergeaud, Blundell, Hemous (2015)
We find:Innovativeness increases top income inequality.
We show that innovation does not increasebroader measures of inequality which do notfocus on top incomes.
Entrant innovation is positively correlated withsocial mobility, but less so in states with moreintense incumbent lobbying activities.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 49
Conclusions
General equilibrium is very important for policy.
Inventors DO respond to policy.
A well-functioning market for ideas/patentswould help economic growth.
Innovation is an important social elevator.
The positive effect of entrant innovation isdampened by lobbying of the incumbents.
Ufuk Akcigit (University of Chicago & NBER) Innovation, Firm Dynamics, and Growth 5th SEEK Conference - # 50